Blog Roll showing outside links & pages, but not posts (15 posts)

I had the idea that blog roll would list the posts automatically, and was relieved when it didn't. I'm thinking maybe I changed a setting, though, and can't find it. I want to list some of the posts, by categories. My categories are working fine, but if I set up a post from my page 2 ("older posts") page as a link and make the category "blog roll," it leads to a file not found error.
I'm in WP 2.8
My questions are:
1) Are there settings for the links (blog roll) widget that I can control? If so, where?
2) Can I link directly to a single post so it pops up on its own?
3) If not, can I at least link to the "page 2" of my posts?
My site is http://tribeofadmins.com.
Thanks for your help!

1. Yes, in Appearance->Widgets, drag the Link widget to the right under Sidebar, then the configure
2. not sure what you are asking--unless putting a post URL in as a Link
3. sure just put the URL in when Adding a new link

if I set up a post from my page 2 ("older posts") page as a link and make the category "blog roll," it leads to a file not found error.

2. I put a post url in as a link and it just leads to the top of the page. Here - here's a link to a post: http://tribeofadmins.com/who-loves-office-2007
When you click on it, it won't take you to the post itself; it will take you to the main page of the blog.
1. All that shows up is:
Show Link Image
Show Link Name
Show Link Description
Show Link Rating
None of which addresses why the individual posts aren't in the blogroll automatically. That was what I thought I must have stopped with a setting.

2. Reveiw Template Hierarchy to determine what template is controlling display of a single post and if necessary, switch to the WordPress Default theme and see how it handles single posts with the singe.php there.

You're brilliant!! Thank you! I've put it back the way it was, temporarily, because changing it to the default means re-doing every one of my internal links, plus changing links I've posted elsewhere (hours of work, easily). So what I'm wondering is, is there a way to show website name/name of post other than /%postname%?